The Determinants of Firm Exit from Exporting: Evidence for the UK

R.I. Harris, Q.C. Li

Research output: Contribution to journalArticlepeer-review


This study seeks to understand to what extent new exporters are able to survive in international markets and whether exit from exporting is more likely to be associated with firm-level heterogeneity or more general factors such as trade costs and/or barriers to entry and exit (such as sunk costs). This study presents the first analysis undertaken for a nationally representative group of UK firms on the determinants of exit from exporting, using panel data covering all market-based sectors of the UK during 1997–2003. Our findings suggest that the probability of a firm ceasing to export is directly influenced by its productivity and other attributes associated with firm-level productivity differences (such as size and foreign ownership). Micro-finance factors, such as profitability and the ability to finance through long-term debt, play an additional role. Lastly, sectoral differences (e.g. industrial concentration) also help explain the firm’s exit decision, whilst trade costs lead to a higher probability of exiting from selling internationally.
Original languageEnglish
Pages (from-to)381-397
Number of pages17
JournalInternational Journal of the Economics of Business
Issue number3
Early online date5 Sept 2011
Publication statusPublished - 3 Nov 2011


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